Drop in manufacturing leads to 7% yearly decline in business sector profits

The total profits of businesses in Estonia in the third quarter of this year amounted to 859 million euros, a 7 percent decline from the same period last year. Profits in the business sector were negatively influenced mostly by construction and wholesale activities, Statistics Estonia said in its quarterly report today.

Profits in the manufacturing sector, which usually accounts for the large plurality of total profit in the business sector, decreased 13 percent, mainly due to a decrease in the profits of export-oriented electronics manufacturing, and a drop in wood and fuel oil products. Transportation and storage, and accommodation and food service activities were the most profitable business areas.

In the third quarter of 2014, businesses and enterprises sold goods and services for 12.6 billion euros, which was 2 percent less than in the same period a year ago. The turnover of trade enterprises, which have the biggest share in the total turnover of the business sector, decreased 4 percent, influenced mostly by a decrease in the turnover of wholesale trade. At the same time, the turnover of retail trade continued to grow; the turnover of manufacturing enterprises increased 7 percent.

Compared to the third quarter of 2013, the total costs of enterprises decreased 1 percent. Personnel expenses increased 8 percent from a year ago.

The investment activity of business enterprises continues to decrease. In the third quarter of this year, enterprises invested 586 million euros, which was 16 percent less than in the same period of the previous year. The largest investments were made mainly in buildings, equipment and machinery.

Reported profits were up slightly - by 10,000 euros - compared to the second quarter of the year. In the second quarter profits amounted to 849 million euros.